United Spirits Ltd Directors Report.

To the Members of United Spirits Limited

Report on the audit of the Standalone Financial Statements

Opinion

1. We have audited the accompanying standalone financial statements of United Spirits Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2021, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the "Act") in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of Affairs of the Company as at March 31, 2021, its total comprehensive income (comprising of Profit and other comprehensive income), changes in equity and its cash flows for the year then ended.

Basis for opinion

3. We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have ful_lled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

4. We draw attention to the following matters:

a) As explained in Note 40(a) to the standalone financial statements, upon completion of the Initial Inquiry, which identified references to certain Additional Parties and certain Additional Matters, the MD & CEO, pursuant to the direction of the Board of Directors, had carried out an Additional Inquiry that revealed transactions indicating actual and potential diversion of funds from the Company and its Indian and overseas subsidiaries to, in most cases, Indian and overseas entities that appear to be affiliated or associated with the Companys erstwhile non-executive Chairman and other potentially improper transactions. The amounts identified in the Additional Inquiry have been fully provided for or expensed by the Company and/or its subsidiaries in earlier periods. Management is currently unable to estimate the financial impact on the Company, if any, arising from potential non-compliances with applicable laws in respect of the above.

b) As explained in Note 40(b)(i) to the standalone financial statements, the Company has commenced the rationalisation process for divestment/ liquidation/ merger of certain overseas subsidiaries including step down subsidiaries. The completion of the above process is subject to regulatory and other approvals (in India and overseas). At this stage, it is not possible for the management to estimate the financial impact on the Company, if any, arising out of potential historical non-compliances with applicable laws, if established.

c) As explained in Note 40(d) to the standalone financial statements, the Managerial remuneration for the year ended March 31, 2015 included an amount paid in excess of the limit prescribed under the provisions of Schedule V to the Act by INR 134 million to the former Executive Director and Chief Financial Officer (ED & CFO). The Company has initiated steps, including by way of filing a suit for recovery before the jurisdictional court, to recover such excess remuneration from the former ED & CFO.

d) Note 40(e) to the standalone financial statements which describes the various regulatory notices and communications received from Securities Exchange Board of India (‘SEBI), Ministry of Corporate Affairs (‘MCA)/ Registrar of Companies, Karnataka (the ‘Registrar), Directorate of Enforcement (‘ED) to which the Company has responded to and communication received from the Companys authorised dealer banks (‘AD) to which the Company is in the process of responding.

e) Note 40(f) to the standalone financial statements which describes the uncertainty relating to the final outcome of litigations with a bank ("the bank") that continues to retain the pledge of certain assets of the Company and of the Companys shares held by USL Benefit Trust (of which the Company is the sole beneficiary) despite the Company prepaying the term loan to that bank along with the prepayment penalty and further depositing an additional sum of INR 459 million demanded by the bank and as directed by the Honble High Court of Karnataka (the "Court"). Based on management assessment supported by external legal opinions, the Company has disclosed the aforesaid amount of INR 459 million under Other Non-current financial assets as recoverable from the bank pending the final outcome of the litigation. In a separate proceeding before the Debt Recovery Appellate Tribunal, the banks appeal against the judgement awarded by Debt Recovery Tribunal in favour of the Company in respect of attachment of the aforesaid pledged shares for recovery of the loans advanced by the bank to Kingfisher Airlines Limited is pending disposal.

f) As explained in Note 40(g) to the standalone financial statements, the Company came across information suggesting continuing past practices resulting in differences in reporting to the relevant Regulatory Authorities of yields of certain non-potable intermediates and associated process losses in the liquor manufacturing process. Related actions taken and monitoring of future development by the Company in this respect have been described in the said note.

Our opinion is not modified in respect of the matters described under paragraph 4 above.

Key audit matters

5. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matter How our audit addressed the key audit matter
a) Assessment of Expected Credit Loss (ECL) provision in respect of Loans to subsidiaries Our audit procedures included the following:
(Refer Notes 5 and 31 to the standalone financial statements) • Understood, evaluated and tested the design and operating effectiveness of Companys controls to assess the adequacy of credit loss on loans to subsidiaries.
These loans to subsidiaries fall within the scope of Ind AS 109- Financial Instruments and are measured at amortised cost using effective interest method. A credit loss provision is recorded to adjust the balance to the present value of estimated cash flows. • Tested the methodology applied in the credit loss provision estimation by comparing it to the requirements of the relevant accounting standard.
The Company has made a (net) provision for credit loss of INR 475 million (March 31, 2020: IR 478 million) for the year ended March 31, 2021. • Examined the repayment terms by reference to the loan agreements with subsidiaries
We considered provisioning for credit loss on loans to subsidiaries as a key audit matter as estimation of credit loss provision requires management to make significant assumptions on forward looking information for subsidiaries such as financial projections, other resources and the ability of the subsidiaries to repay those loans. • Tested the mathematical accuracy of managements model used to calculate credit loss provision and evaluated key underlying assumptions such as expected growth in revenue, cost savings, timing and ability to repay loans by evaluation of forecasts of future cash flows.
• Evaluated the adequacy of disclosures made in the standalone financial statements.
Based on above audit procedures performed, we did not note any significant exception to ECL provision in respect of loans to subsidiaries.
a) Assessment of the appropriateness of provisions recognised and contingent liabilities disclosed in respect of certain tax matters (Refer notes 8, 17 and 42 to the standalone financial statements and Appendix 1 to Annexure A of the Audit Report) Our audit procedures included the following:
• Understood, assessed and tested the design and operating effectiveness of the Companys controls in respect of identifying potential tax exposures and/or the accounting and disclosures thereof.
• Evaluated the related accounting policy for provisioning for tax exposures/ disclosure of contingent liabilities by comparing it to the requirements of the relevant accounting standards.
As at March 31, 2021, the Company has significant tax exposures and is subject to periodic assessments/ demands by tax authorities on transfer pricing, income tax and a range of indirect tax matters. Consequent to such tax assessments and demands relating to past several years, the Company has paid certain amounts under protest at various dates. The Company has also filed appeals with various appellate authorities against such demands. • Obtained managements assessment in respect of tax demands on whether tax outflow is either probable, possible or remote.
• Evaluated the managements assessment with the help of auditors experts, where necessary, as follows:
o For the samples selected, read the correspondences received during the year from the tax authorities/ orders from appellate authorities.
Management judgement is involved in assessing the likelihood of ultimate outcome of the tax disputes to decide on the accounting/ disclosure requirements. In certain complex matters the probable amount of the outflows determined by management is supported by opinions obtained from external tax counsels/ assessment performed by internal experts (management tax experts). o Read views provided by the management/ management tax experts as applicable.
o Assessed managements positions on significant tax exposures in accordance with tax laws and past precedents of tax judgements.
o Ensured completeness of litigations by inquiring with the management, review of board minutes, and review of significant legal expenses.
We considered this a key audit matter as: o Evaluated the objectivity, competence and capabilities of the management tax experts.
• The amounts involved are significant to the standalone financial statements. o Evaluated the adequacy of disclosures made in the standalone financial statements.
• Change in the managements judgements and estimates may significantly a_ect the provisions recognised or contingent liabilities disclosed. Based on the above procedures, we considered the managements assessment in recognising provisions and disclosing contingent liabilities in respect of the stated tax matters, as reasonable.
• Matters of disputes are complex in some cases due to the industry in which the Company operates and may lack clarity under tax laws.

Other Information

6. The Companys Board of Directors is responsible for preparation of the other information. The other information comprises the information included in the Report of the Directors, Business Responsibility Report, Corporate Governance Report and Management Discussion and Analysis, but does not include the standalone financial statements and our auditors report thereon.

7. Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

8. In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the Standalone Financial Statements

9. The Companys Board of Directors is responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance (including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act . This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate implementation and maintenance of accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

10. In preparing the standalone financial statements, management is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. The Board of Directors is also responsible for overseeing the Companys financial reporting process.

Auditors responsibilities for the audit of the Standalone Financial Statements

11. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

12. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit.

13. We also:

a) Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

b) Obtain an understanding of internal controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3) (i) of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to the standalone financial statements in place and the operating effectiveness of such controls.

c) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

d) Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

e) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

14. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.

15. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

16. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

17. As required by the Companies (Auditors Report) Order, 2016, issued by the Central Government of India in terms of Section 143(11) of the Act ("the Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the "Annexure A" statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

18. As required by Section 143(3) of the Act, to the extent applicable, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31, 2021 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021 from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls with reference to the financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B".

g) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2021 on its financial position in its standalone financial statements – Refer Notes 8, 17, 40(c), 40(d), 40(f) and 42 to the standalone financial statements;

ii. The Company has long-term contracts for which there are no material foreseeable losses. The Company did not have derivative contracts as at March 31, 2021 – Refer Note 39 to the standalone financial statements;

iii. The Company has transferred amounts required to be transferred to the Investor Education and Protection Fund by due dates during the year ended March 31, 2021 . Also Refer Note 16 to the Standalone financial statements;

iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2021.

19. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

For Price Waterhouse & Co Chartered Accountants LLP

Firm Registration Number: 304026E/E-300009

Chartered Accountants

Dibyendu Majumder

Partner

Membership Number: 057687

UDIN: 21057687AAAAAP6562

Place : Bengaluru

Date : May 21, 2021

Annexure A to Independent Auditors Report

Referred to in paragraph 17 of the Independent Auditors Report of even date to the members of United Spirits Limited on the standalone financial statements as of and for the year ended March 31, 2021

i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) The title deeds of immovable properties, as disclosed in Note 3.1 and Note 3.2 to the standalone financial statements (Property, plant and equipment), are held in the name of the Company except as disclosed as below:

Description Building
Number of properties 1
Gross carrying amount as at March 31, 2021 (INR millions) 339
Net carrying amount as at March 31, 2021 (INR millions) 301

The above table does not include the title deeds of immovable properties mortgaged with a bank, properties for which title deeds are held in the name of erstwhile merged entities and certain immovable properties for which management has furnished photocopies of the title deeds and other corroborative documents to evidence the ownership of the properties. Refer notes 3.1, 3.2 and 33 to the standalone financial statements.

ii. The physical verification of inventory including stocks with certain third parties and excluding stock in transit have been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with the third parties, these have substantially been confirmed by them. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

iii. There are no companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Act for the purpose of loans granted by the Company.

iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Act in respect of the loans and investments made. The Company has not provided any guarantees or security to parties covered under Sections 185 and 186 of the Act.

v. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Sections 73, 74, 75 and 76 or any other relevant provisions of the Act and the Rules framed thereunder to the extent notified, with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

vi. The Central Government of India has not specified the maintenance of cost records under Section 148 (1) of the Act for any of the products of the Company.

vii. (a) According to the information and explanations given to us including managements assessment in respect of the provident fund matter as referred to in Note 42 (d) to the standalone financial statements and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues in respect of employees state insurance, tax deducted at source, value added tax, provident fund, income tax and professional tax though there has been slight delay in a few cases and is regular in depositing other undisputed statutory dues including goods and services tax, tax collected at source, sales tax, duty of excise, duty of customs and other material statutory dues, as applicable, with appropriate authorities. Further, for the period April to May 2020, the company has paid Goods and Services Tax and filed GSTR- 3B after the due date but within the timelines allowed by Central Board of Indirect Taxes and Customs under the Notification number 32/2020 and Circular no- 136/06/2020 dated April 3, 2020 on fulfilment of conditions specified therein.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income tax, sales tax, value added tax, service tax, duty of customs, duty of excise and entry tax as at March 31, 2021 which have not been deposited on account of a dispute are disclosed in Appendix 1 to this report. There have been no dues of goods and services tax which have not been deposited on account of a dispute.

viii. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.

ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.

x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its Officers or employees, noticed or reported during the year, nor have we been informed of such case by the Management.

xi. The Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act. Also refer to paragraph 19 of the main audit report.

xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the standalone financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act.

xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any non cash transactions with its directors or persons connected with them. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

For Price Waterhouse & Co Chartered Accountants LLP

Firm Registration Number: 304026E/E-300009

Chartered Accountants

Dibyendu Majumder

Partner

Membership Number: 057687

UDIN: 21057687AAAAAP6562

Place : Bengaluru

Date : May 21, 2021

Appendix 1 – Particulars of Tax dues not deposited on account of a dispute *

Referred to in paragraph vii(b) of Annexure A to the Independent Auditors Report to the members of United Spirits Limited on the standalone financial statements as of and for the year ended March 31, 2021

Name of the statute Nature of dues Disputed amount Amount paid Unpaid Amount Financial year to which the amount relates Forum where the dispute is pending
(INR millions) (INR millions) (INR millions)
Income Tax Act, 1961 Income Tax 3,298 2,949 350 2006-07 to 2008-09, 2010-11 and 2011-12 Assessing Officer of Income Tax
Income Tax Act, 1961 Income Tax 158 158 - 2009-10 Commissioner of Income Tax (Appeals)
Income Tax Act, 1961 Income Tax 6,822 - 6,822 2015-16 Dispute Resolution Panel
Income Tax Act, 1961 Income Tax 19,341 6,611 12,730 1988-89, 1989-90,1991- 92, 1992-93, 1993-94, 1995-96,2000-01, 2005-06, 2006-07, 2008-09, 2012-13 to 2014-15 Income Tax Appellate Tribunal
Income Tax Act, 1961 Income Tax 8,927 553 8,374 1985-86 to 2004-05, 2007- 08, 2011-12 High Courts of various states
Customs Act, 1962 Custom Duty 0 - 0 1997-98 Commiss ioner of Customs
Customs Act, 1962 Custom Duty 2 - 2 1993-94 to 1995-96 Madras High Court
Service Tax - Finance Act 1994 Service Tax 1,344 - 1,344 2006-07 to 2015-16 Commissioner of Service Tax
Service Tax - Finance Act 1994 Service Tax 924 40 884 2004-05 to 2006-07, 2008- 09 to 2010-11, 2015-16, 2016-17 Customs Excise and Service Tax Appellate Tribunal
Service Tax - Finance Act 1994 Service Tax 2 - 2 2012-13 High Court of Kerala
Central Excise Act, 1944 Central Excise Duty 1,780 14 1,766 1994-95, 1999-2000 and 2017-2018 Commissioner of Central Excise
Central Excise Act, 1944 Central Excise Duty 2 - 2 1999-2000 Deputy Commissioner of Central Excise
Karnataka Sales Tax Act,_1957 Sales Tax/ Value Added Tax 3 - 3 2006-07 Civil Court, Karnataka
West Bengal Sales Tax Act, 1994_ Sales Tax/ Value Added Tax 766 - 766 2015-16 Commissioner of
Commercial Taxes
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 7 3 4 2015-16, 2016-17 Assessing Officer
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 10 6 4 1993-94 to 1997-98 Commercial Tax Officer

* As represented by the management

# ‘0 indicates that the amounts involved are below INR five lakhs and the sign ‘- indicates that amounts are Nil

Appendix 1 – Particulars of Tax dues not deposited on account of a dispute *

Referred to in paragraph vii(b) of Annexure A to the Independent Auditors Report to the members of United Spirits Limited on the standalone financial statements as of and for the year ended March 31, 2021

Name of the statute Nature of dues Disputed amount Amount paid Unpaid Amount Financial Year to which the amount relates Forum where the dispute is pending
(INR millions) (INR millions) (INR millions)
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 156 43 113 1994-95 to 1996-97, 2005-06, 2006-07, 2009-10 to 2013-14, 2015-16 to 2017-18 Assistant Commissioner of Commercial Taxes
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 29 1 28 2003-04, 2004-05, 2006-07 to 2013-14, 2016-17 and 2017-18 Additional Commissioner of Commercial Taxes
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 208 56 152 1985-86, 1989-90, 2004-05 to 2013-14, 2015-16 and 2017-18 Deputy Commissioner of Commercial Taxes
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 2,191 537 1,654 2000-01 to 2015-16 Joint Commissioner of Commercial Taxes
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 215 25 190 1987-88,1990-91, 1992-93 to 2000-01, 2004-05, 2005-06, 2007-08, 2012-13 Commercial Taxes Appellate Tribunal
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 15 - 15 1993-94, 2003-04, 2005-06 Commercial Taxes Appellate Tribunal and Revisionary Board
Central and Various State Sales Tax Acts Sales Tax/ Value Added Tax 198 157 41 1978-79 to 1984-85, 1988-89, 1989-90, 1992-93, 1993-94, 1996-97 to 2001-02, 2007-08 and 2009-10 to 2011-12 High Courts of various states
Various Entry Tax Acts Entry Tax 5 2 3 1989-90 and 2015-16 Assessing Officer
Various Entry Tax Acts Entry Tax 7 1 6 2007-08 to 2010-11 Joint Commissioner of Commercial Taxes
Various Entry Tax Acts Entry Tax 24 16 8 2000-01, 2004-05 and 2007-08 Commercial Taxes Appellate Tribunal

* As represented by the management

# ‘0 indicates that the amounts involved are below INR five lakhs and the sign ‘- indicates that amounts are Nil

Appendix 1 – Particulars of Tax dues not deposited on account of a dispute *

Referred to in paragraph vii(b) of Annexure A to the Independent Auditors Report to the members of United Spirits Limited on the standalone financial statements as of and for the year ended March 31, 2021

Name of the statute Nature of dues Disputed amount Amount paid Unpaid Amount Financial Year to which the amount relates Forum where the dispute is pending
(INR millions) (INR millions) (INR millions)
Various Entry Tax Acts Entry Tax 337 15 322 2005-06, 2007-08 to 2013-14 High Courts of various states
Various Entry Tax Acts Entry Tax 17 14 3 2003-04 to 2007-08 Supreme Court
Bengal Excise Act, 1909 and Bengal Excise (Amendment) Act, 2012 State Excise 13 - 13 1993-94 Civil Court, West Bengal
Bengal Excise Act, 1909 and Bengal Excise (Amendment) Act, 2012 State Excise 1 - 1 1994-95 and 2014-15 Collector of State Excise, West Bengal
Bengal Excise Act, 1909 and Bengal Excise (Amendment) Act, 2012 State Excise 1 - 1 2016-17 Additional District Magistrate, West Bengal
Various State Excise Acts State Excise 26 - 26 2010-11 to 2017-18 Superintendent of State Excise
The Maharashtra Prohibition Act, 1949 State Excise 168 36 132 2019-20 Deputy Superintendent of State Excise
Various State Excise Acts State Excise 66 33 33 2001-02, 2002-03, 2015-16 Principal Secretary Excise
Various State Excise Acts State Excise 181 51 130 1974-75 to 1988-89, 1993- 94 to 1998-99, 2002-03 to 2009-10, 2011-12, 2013-14 to 2016-17 Commissioners of State Excise
Various State Excise Acts State Excise 2 1 1 1987-88 Additional Commissioners of Excise
Various State Excise Acts State Excise 10 - 10 1994-95, 2001-02 and 2003-04 to 2007-08 State Taxation Tribunals
Various State Excise State Excise 254 94 161 1972-73, 1973-74, 1980-81, 1982-83, 1997-98, 1998-99, 2001-02,2002-03, 2010-11, 2012-13 to 2015-16 High Courts of various states
Acts
Various State Excise Acts State Excise 1,506 84 1,422 1971-72, 1992-93, 1996-97, 2002-03, 2004-05, 2012-13 Supreme Court

* As represented by the management

# ‘0 indicates that the amounts involved are below INR five lakhs and the sign ‘- indicates that amounts are Nil

Annexure B to Independent Auditors Report

Referred to in paragraph 18(f) of the Independent Auditors Report of even date to the members of United Spirits Limited on the standalone financial statements as of and for the year ended March 31, 2021 Report on the Internal Financial Controls with reference to Financial Statements under Section 143(3)(i) of the Act

1. We have audited the internal financial controls with reference to the financial statements of United Spirits Limited ("the Company") as of March 31, 2021 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

2. The Companys management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India ("ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors Responsibility

3. Our responsibility is to express an opinion on the Companys internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing deemed to be prescribed under Section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements were established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of internal financial controls with reference to financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controls based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit